Promises but no allocations in the Budget – Eran

The following article is based on the comments made by UNP MP Eran Wickremaratne yesterday in Parliament during the debate on the 2015 Budget

 
The total expenditure budgeted for 2014 was Rs. 2,084 billion.  Adjusted for inflation it would be Rs.2, 196 billion.  The Budget allocation for 2015 was Rs.2, 210 billion therefore the actual increase is Rs. 14 billion.
nThe shortfall from the actual allocation and the required allocation amounts to Rs.169,741 m
There were many promises that were made in Budget 2015.  The costed initiatives would require an allocation of Rs. 182 billion.  However, the real increase in allocations in the Budget is only Rs.14 billion.  There is a shortfall of Rs. 169 billion. Hence, the Finance Minister’s speech becomes an election promise rather than a National Budget. The proposals are a wish list. This government is incapable of reducing wastage and corruption, its track record speaks for itself. Therefore most of the proposals will not materialise in 2015 but be postponed for the future.
The tax revenue budgeted in 2014 was Rs. 1,416 billion, while it is Rs.1, 688 billion for 2015, an increase of 19%.  This is an incredible increase of tax revenue given the fall in tax revenue in recent years.  It must also be noted that income tax rates and VAT is budgeted to reduce.  However, no estimate has been included in the Budget. The Government indicated that Rs.40 billion will be collected in back taxes.
The Government must table the list of tax defaulters in the event it cannot collect these taxes as we suspect that tax dodgers have political protection.
The budget proposals are not backed by allocations.  The management of the budgetary process is wanting.   The allocation of capital for state banks is required because of the rising bad debt. Loans at the behest of politicians are being funded by taxpayers.  We believe that a dedicated Finance Minister is required to better manage the finances of the country.  Our Constitutional reforms will seek to correct this situation.
An allocation to Agriculture was Rs. 102 billion in 2012 while only Rs. 76 billion was spent.  In 2013 Rs.111 billion was allocated while only Rs. 66 billion was spent.  Both in 2012 and 2013 the actual expenditure was 30% and 39% below the allocation.  The Government has no funds to carry out its own proposals so it resorts to allocations fully knowing that it cannot be fully implemented.

 
Education
The allocated expenditure for 2014 was Rs.52 billion.  Inflation adjusted expenditure is Rs.54 billion.  The allocation for 2015 is Rs.55 billion.  Therefore the additional real allocation for the Education Ministry is Rs.1 billion.  The Government made special allocations of Rs.13.1 billion for sanitation facilities for schools, increasing Grade 5 scholarships, developing of teacher training, recruiting 50,000 more teachers and the modernizing 100 schools.  But with an effective increase of only Rs.1 billion it has not provided for the promises it enunciated in the Budget Speech.

 
Higher Education
In 2014 the Budget allocation was Rs.40 billion, adjusted for inflation its value in 2015 would be Rs. 41.6 billion.  The Budget allocation for 2015 was Rs. 41 billion. The Government also promised special allocation of Rs.1.5 billion to increase higher education scholarships, allocations for the Postgraduate Institute of Pali and Buddhist Studies and also University research and development initiatives.
The shortfall in the Budget is approximately Rs. 2 billion. There is no room in the Higher Education Ministry allocation unless there are cuts that will be implemented in other areas. We allocate Rs. 41 billion for Higher Education for the entire country while we lose Rs.30 billion on SriLankan Airlines in 2013.  We are likely to lose another Rs. 30 billion in 2014.  These are economic crimes as they sacrifice future generations.
We spend only Rs.1000 per month on a primary and secondary school student.
Can we deliver a quality education with such abysmally small allocations for education?

 

 
Pensioners
Farmer pension schemes were suspended and restarted.  An allocation of Rs. 1.5 billion has been made while there is no allocation for Government workers, migrant workers or three-wheel drivers despite the promise of a pension.
These promises have been made in earlier Budget speeches too but no pension schemes have been executed.